Scott v. Sun Bank of Volusia County

• Decision Date: 02 December 1981
• Docket Number: No. 80-1230,80-1230
• Citation: 408 So.2d 591
• Parties: George C. SCOTT, Appellant, v. SUN BANK OF VOLUSIA COUNTY, formerly known as Exchange Bank at Holly Hill, aFlorida corporation, Appellee.
• Court: Florida District Court of Appeals

Page 591

408 So.2d 591

George C. SCOTT, Appellant, v. SUN BANK OF VOLUSIA COUNTY, formerly known as Exchange Bank at Holly Hill, aFlorida corporation, Appellee.

No. 80-1230.

District Court of Appeal of Florida, Fifth District.

Dec. 2, 1981.

Rehearing Denied Jan. 12, 1982.

Theodore F. Zentner of Becks, Becks & Wickersham, Daytona Beach, for appellant.

Harold C. Hubka of Black, Crotty, Sims & Hubka, Daytona Beach, for appellee.

FRANK D. UPCHURCH, Jr., Judge.

Appellant George C. Scott appeals from an order dismissing with prejudice his third amended complaint.

SP&W, Inc. performed engineering services for D & B Cattle Company and as payment accepted a promissory note in the amount of $191,747 which was secured by a mortgage on D & B's land. SP&W assigned the mortgage to appellee, Sun Bank, as collateral for a loan.

Appellant, a stockholder in SP&W, sold his stock for redemption to SP&W. SP&W gave appellant a note for $90,771 and secured it by assigning its remaining interest in the D & B mortgage. Because of the prior assignment to Sun Bank, the assignment could not go into effect until SP&W had fully repaid Sun Bank. SP&W by letter informed Sun Bank of the subsequent assignment and requested that the bank release the mortgage to appellant when the loan was fully repaid. Sun Bank, through its president, accepted the assignment, responding:

The undersigned bank, consents and agrees to assign the mortgage and note described herein to George C. Scott, once said bank has been paid in full for the debt which it holds said assignment of mortgage for.

On March 3, 1975, SP&W discharged its debt to Sun Bank. However, the bank failed to assign the mortgage to appellant as agreed. SP&W continued to collect all payments on the mortgage until August 17, 1978, when the D & B mortgage was satisfied. Appellant alleged that SP&W was in default to him on March 3, 1975, and further defaulted by failing to make any subsequent payments.

Appellant sued in four counts: 1) breach of a third party beneficiary contract, 2) breach of contract of novation; 3) negligence, and 4) promissory estoppel. Counts I and II which both alleged a contractually based cause of action arising from SP&W's letter to Sun Bank were dismissed with prejudice on the ground that consideration was lacking. Appellant contends that SP&W's agreement to release the bank from its obligation of re-assigning the note and mortgage to SP&W was sufficient to bind the bank. In Greenfield v. Millman, 111 So.2d 480 (Fla. 3d DCA 1959), the court quoted the applicable rule from Restatement (First), Contracts § 84:

Consideration is not insufficient because of the fact

(c) That the party giving the consideration is then bound by a duty owed to the promisor or to the public, or by any duty imposed by the law of torts or crimes, to render some performance similar to that given or promised if the act or forebearance given or promised as consideration differs in anyway from what was previously due.

111 So.2d at 482.

The court also noted Professor Williston's pronouncement that the difference between two promises, "however trifling, is enough to make new performance detrimental or the new promise a promise of something detrimental." Id. Here SP&W's relinquishment of its right to receive the mortgage from Sun Bank when the bank no longer needed it as collateral, constituted consideration for Sun Bank's promise to deliver the mortgage to appellant (something it was not previously obligated to do). The fact...